Gross profit expected to increase 11% YoY in Q3 2017 for Staffing 360 Solutions
Staffing 360 Solutions, Inc. has pre-announced its unaudited financial results for the fiscal third quarter ended 30th September 2017.
Subject to the completion of the review of Staffing 360 Solutions’ full financial statements and filing with the Securities and Exchange Commission, the results for its fiscal third quarter 2017 are expected to be as follows:
- Revenue of $50m, an approximately 9% increase from $46m in the 2016 third quarter, including $6m from acquisitions. On a sequential quarterly basis, revenue is expected to improve by $8m, or over 18% compared to the fiscal second quarter of 2017. For the nine months ended September 2017, revenue is expected to decrease by $2.2m, including $1.8m attributable to unfavourable foreign currency translation and the acquisition revenue discussed above, to $133m from $135m for the comparable period in fiscal 2016;
- Gross profit of over $9m, an 11% increase over $8.4m in the fiscal third quarter of 2016. On a sequential basis, gross profit is expected to improve by $1m, or 18% compared to the fiscal second quarter of 2017. For the nine months ended September 2017, gross profit is expected to increase by over 3% from $23.6m to $24.5m for the comparable period in fiscal 2016;
- Gross margins continued to remain strong, increasing from 18.3% in the prior year third quarter to 18.5% in the third quarter of fiscal 2017. For the nine months ended September 2017, the gross margin is expected to be 18.5%, an improvement from 17.4% for the comparable period in fiscal 2016;
- The two acquisitions completed in September, CBS Butler Holdings Limited in the U.K. and firstPRO Georgia in the U.S. are included in these results for only a few weeks. The full impact of these acquisitions will be reflected in the fiscal fourth quarter of 2017;
- Including $5.6m of non-cash charges, (relating to the refinancing of the balance sheet as well as depreciation and amortization of intangible assets, and approximately $0.9m of acquisition-related and other non-recurring expenses) the net loss attributable to common stock is expected to be approximately $5.3m for the fiscal third quarter of 2017 compared to $0.9m for the comparable period in fiscal 2016. For the nine months the net loss attributable to common stock is expected to be approximately $9.4m, including $10.8m of non-cash charges (relating to the refinancing, depreciation and amortization of intangible assets, and $1.2m of acquisition-related and other non-recurring expenses) against approximately $6.3m for the comparable period in fiscal 2016;
- Adjusted EBITDA is expected to be $2m, a 25% increase over $1.7m in the fiscal third quarter of 2016. For the nine months Adjusted EBITDA, is expected to be $5.8m, an increase of 7% over $5.4m for the comparable period in fiscal 2016.
“The third quarter was a transformational period in the history of Staffing 360 Solutions,” stated Brendan Flood (pictured), executive chairman of Staffing 360 Solutions. “We completed two acquisitions bringing our annualized revenues to $265 million and materially refinanced our balance sheet, improving our working capital position and ability to generate positive operating cash flow. More importantly, our trailing twelve months’ pro-forma Adjusted EBITDA is now $11 million, up from $5.4 million in the comparable trailing twelve months of 2016.
“Looking forward, we are now positioned to see further growth as we utilize operating cash flow for investment in people and services in 2018 and beyond.”
The Company expects to file its full results for the fiscal first quarter ended 30th September 2017 on Form 10-Q before the SEC filing deadline in mid-November and will host an earnings conference call around the same time to discuss the results.